Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>Tencent has been interested in acquiring Nexon for more than six years. However, the timing and price were not right for such a deal to take place in the past.</li>
<li>The higher probability scenario is for Kim's family members to sell when the timing and price is right. This time around, a $15 billion could be the right price. </li>
<li>Late founder Kim's family members own a 44.4% stake in Nexon through NXC Corp and its affiliate NXMB BV. Kim's wife and daughters own a 67.6% stake in NXC Corp. </li>
</ul>


Tencent has been interested in acquiring Nexon for more than six years. However, the timing and price were not right for such a deal to take place in the past.
The higher probability scenario is for Kim's family members to sell when the timing and price is right. This time around, a $15 billion could be the right price. 
Late founder Kim's family members own a 44.4% stake in Nexon through NXC Corp and its affiliate NXMB BV. Kim's wife and daughters own a 67.6% stake in NXC Corp. 


Tencent To Acquire Nexon? Time and Price Lining Up for a Final Deal?

Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

<ul>
<li>Government aims to sell 30.6% NXC stake by 2027 for ₩4T tax revenue, offering NXC a buyback or selling with management control to attract bidders.</li>
<li>The family won’t buy back the 30.6% stake but may allow partial management rights, with Tencent eyeing that stake—not a full $15B Nexon buyout as Bloomberg suggested.</li>
<li>Tencent’s targeting that stake chunk only, no control shift, so no mandatory tender offer triggered—at least for now.</li>
</ul>


Government aims to sell 30.6% NXC stake by 2027 for ₩4T tax revenue, offering NXC a buyback or selling with management control to attract bidders.
The family won’t buy back the 30.6% stake but may allow partial management rights, with Tencent eyeing that stake—not a full $15B Nexon buyout as Bloomberg suggested.
Tencent’s targeting that stake chunk only, no control shift, so no mandatory tender offer triggered—at least for now.


More Accurate Context Behind Tencent’s Nexon Moves Reported by Bloomberg

Japanese Turnaround Situations, Short-Ideas, Azabu Research

Michael Allen

Japanese Turnaround Situations, Short-Ideas

Azabu Research

Azabu Research is a publishing and consulting firm focused on distressed equities in the Japanese market. We specialize in turnaround strategies, corporate combinations, divestitures, and restructuring.

Publisher of the Tokyo Turnaround Letter, which conducts the most thorough research possible of publicly available information, including forensic tests for fraudulent overstatement of assets and understatement of liabilities, as well as rigorous market and industry analysis to assess the underlying strengths of the company’s products or services, the appropriateness of the company’s turnaround strategy, and the skill of its current management team. The average length of a report exceeds 25 pages of text and tables, excluding any disclosures or executive summaries.

We have more than 30 years of experience in applying this process to distressed equities in Japan. Additionally, subscribers have free access to detailed, yet easily navigated earnings models for the target company as well as the top five comparable companies, and unlimited access to the analyst for follow-up questions.

Azabu Research also conducts be-spoke research on a project basis, and provides consulting services to companies looking to restructure, divest, make acquisitions, go public, or improve investor sentiment toward their stock.

Independent Research and Consulting Firm

Equity Bottom-Up

<ul>
<li>Nexon underperformed the software segment by 32% in the past 12 months, and analysts expect earnings to decline over the next 5 years.</li>
<li>But the company beat Q1 consensus EBIT estimates.by 54% and the stock lurched 17% the very next day.</li>
<li>Nexon’s business is immune to tariffs and tends to perform well in recessions. The company’s pipeline appears to be stronger than anyone imagined.</li>
</ul>


Nexon underperformed the software segment by 32% in the past 12 months, and analysts expect earnings to decline over the next 5 years.
But the company beat Q1 consensus EBIT estimates.by 54% and the stock lurched 17% the very next day.
Nexon’s business is immune to tariffs and tends to perform well in recessions. The company’s pipeline appears to be stronger than anyone imagined.


Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/shift-up-corp" target="_blank" data-smartkarma-citation="entities:36232:1" rel="noopener">Shift Up (462870 KS)</a> raised around US$320m in its South Korean IPO, after pricing at the top. Around US$1.2bn worth of shares will be released from their lockup soon.</li>
<li>Shift Up is a South Korean games developer, which as released three games so far for the global markets.</li>
<li>In this note, we will talk about the lockup dynamics and possible placement.</li>
</ul>



Shift Up (462870 KS) raised around US$320m in its South Korean IPO, after pricing at the top. Around US$1.2bn worth of shares will be released from their lockup soon.
Shift Up is a South Korean games developer, which as released three games so far for the global markets.
In this note, we will talk about the lockup dynamics and possible placement.


Shift Up IPO Lockup - US$1.2bn Lockup Release of Strategic, Employees and IPO Investors

Japan Specialist

Mark Chadwick

<ul>
<li>Nexon’s 3Q24 earnings report saw its stock dip -17% as revenue missed guidance and foreign exchange losses weighed on the bottom line.</li>
<li>Nexon’s operating profit rose +11% y/y to ¥51 billion, with an operating margin of 38%</li>
<li>The stock is trading at 8.5x EBITDA, which makes it very attractive versus the sector</li>
</ul>


Nexon’s 3Q24 earnings report saw its stock dip -17% as revenue missed guidance and foreign exchange losses weighed on the bottom line.
Nexon’s operating profit rose +11% y/y to ¥51 billion, with an operating margin of 38%
The stock is trading at 8.5x EBITDA, which makes it very attractive versus the sector


Nexon (3659) | Down 17% on Quarterly Miss!

Japan

Nexon Co., Ltd. mainly develops and services, online games for PC and mobile devices. The company also offers consulting services related to online-games. Nexon operates in Japan.

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Nexon (3659 JP)

Tencent To Acquire Nexon? Time and Price Lining Up for a Final Deal?

The higher probability scenario is for Kim's family members to sell when the timing and price is right. This time around, a sale of NXC Corp/Nexon...

Douglas Kim

More Accurate Context Behind Tencent’s Nexon Moves Reported by Bloomberg

This post digs deeper to give you the more accurate, behind-the-scenes context on Tencent’s Nexon moves that Bloomberg reported.

Sanghyun Park

How Nexon (3659) Got Its Mojo Back

Nexon beat Q1 consensus EBIT estimates.by 54% but still lags other software companies. The company's immune to tariffs and recession-resistant,...

Michael Allen

Shift Up IPO Lockup - US$1.2bn Lockup Release of Strategic, Employees and IPO Investors

Shift Up (462870 KS) raised around US$320m in its South Korean IPO, after pricing at the top. Around US$1.2bn worth of shares will be released from...

Sumeet Singh

Nexon (3659) | Down 17% on Quarterly Miss!

Nexon's 3Q24 earnings dip -17% due to revenue miss and forex losses, but operating profit rises +11% with attractive valuation at 8.5x EBITDA.

Mark Chadwick

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52-week Range

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Tencent To Acquire Nexon? Time and Price Lining Up for a Final Deal?

The higher probability scenario is for Kim's family members to sell when the timing and price is right. This time around, a sale of NXC Corp/Nexon...

Douglas Kim

More Accurate Context Behind Tencent’s Nexon Moves Reported by Bloomberg

This post digs deeper to give you the more accurate, behind-the-scenes context on Tencent’s Nexon moves that Bloomberg reported.

Sanghyun Park

How Nexon (3659) Got Its Mojo Back

Nexon beat Q1 consensus EBIT estimates.by 54% but still lags other software companies. ​The company's immune to tariffs and recession-resistant,...

Michael Allen

Shift Up IPO Lockup - US$1.2bn Lockup Release of Strategic, Employees and IPO Investors

Shift Up (462870 KS) raised around US$320m in its South Korean IPO, after pricing at the top. Around US$1.2bn worth of shares will be released from...

Sumeet Singh

Nexon (3659) | Down 17% on Quarterly Miss!

​Nexon's 3Q24 earnings dip -17% due to revenue miss and forex losses, but operating profit rises +11% with attractive valuation at 8.5x EBITDA.

Mark Chadwick

Nexon beat Q1 consensus EBIT estimates.by 54% but still lags other software companies. The company's immune to tariffs and recession-resistant,...

Nexon's 3Q24 earnings dip -17% due to revenue miss and forex losses, but operating profit rises +11% with attractive valuation at 8.5x EBITDA.